Malaysia's securities market watchdog has issued a cease-and-desist to a startup ahead of its planned initial coin offering (ICO).
The CopyCash Foundation, according to a statement from the Securities Commission Malaysia (SC), was sent the notice following an inquiry into its pitch to investors. On its website, CopyCash promotes itself as a platform for "social travesting", or a mixture of investing and trading.
"The directive was issued by the SC following its inquiry after it found that there is a reasonable likelihood that disclosures in CopyCash Foundation’s white paper and representations to potential investors will contravene relevant requirements under securities laws," the agency said in a statement.
The SC referenced CopyCash in a Jan. 5 statement on the blockchain funding model, noting at the time that it planned to meet with representatives of the CopyCash Foundation "to inquire into its activities including the purported launch of [CopyCashCoin]."
That the regulator would act swiftly to issue the cease-and-desist notice is perhaps unsurprising, given moves by agencies in other parts of the world to quash ICOs ahead of their launch. SC said in its Jan. 5 statement that it had noticed an uptick of ICO promotion within Malaysia, including solicitations of elderly citizens.
The SC added that it would work with other bodies, including Malaysia's central bank, on the ICO issue.
"The SC continues to work with Bank Negara Malaysia and other enforcement agencies, including our foreign counterparts, to closely monitor such activities and will take appropriate action where necessary," the agency said at the time.
Malaysia currency image via Shutterstock